North American Free Trade Agreement (NAFTA)

Part Two: Trade in Goods

Chapter Three: National Treatment and Market Access for Goods

Annex 300-B: Textile and Apparel Goods

Section 1: Scope and Coverage

1. This Annex applies to the textile and apparel goods set out in Appendix 1.1.

2. In the event of any inconsistency between this Agreement and the Arrangement Regarding International Trade in Textiles (Multifiber Arrangement), as amended and extended, including any amendment or extension after January 1, 1994, or any other existing or future agreement applicable to trade in textile or apparel goods, this Agreement shall prevail to the extent of the inconsistency, unless the Parties agree otherwise.

Section 2: Tariff Elimination

1. Except as otherwise provided in this Agreement, each Party shall progressively eliminate its customs duties on originating textile and apparel goods in accordance with its Schedule to Annex 302.2 (Tariff Elimination), and as set out for ease of reference in Appendix 2.1.

2. For purposes of this Annex:

• (a) a textile or apparel good shall be considered an originating good if the applicable change in tariff classification set out in Chapter Four (Rules of Origin) has been satisfied in the territory of one or more of the Parties in accordance with Article 404 (Accumulation); and
• (b) for purposes of determining which rate of customs duty and staging category is applicable to an originating textile or apparel good, a good shall be considered a good of a Party
  • (i) as determined by each importing Party's regulations, practices or procedures, except that
  • (ii) in the event of an agreement between the Parties pursuant to Annex 311 as determined by such agreement.

3. An importing Party and an exporting Party may identify at any time particular textile and apparel goods that they mutually agree fall within:

• (a) hand-loomed fabrics of a cottage industry;
• (b) hand-made cottage industry goods made of such hand-loomed fabrics; or
• (c) traditional folklore handicraft goods.

The importing Party shall grant duty-free treatment to goods so identified, if certified by the competent authority of the exporting Party.

4. Appendix 2.4 applies to the Parties specified in that Appendix respecting the elimination of tariffs on certain textile and apparel goods.

Section 3: Import and Export Prohibitions, Restrictions and Consultation Levels

1. Each Party may maintain a prohibition, restriction or consultation level only in accordance with Appendix 3.1 or as otherwise provided in this Annex.

2. Each Party shall eliminate any prohibition, restriction or consultation level on a textile or apparel good that otherwise would be permitted under this Annex if that Party is required to eliminate such measure as a result of having integrated that good into the GATT as a result of commitments undertaken by that Party under any successor agreement to the Multifiber Arrangement.

Section 4: Bilateral Emergency Actions (Tariff Actions)

1. Subject to paragraphs 2 through 5 and during the transition period only, if, as a result of the reduction or elimination of a duty provided for in this Agreement, a textile or apparel good originating in the territory of a Party, or a good that has been integrated into the GATT pursuant to a commitment undertaken by a Party under any successor agreement to the Multifiber Arrangement and entered under a tariff preference level set out in Appendix 6, is being imported into the territory of another Party in such increased quantities, in absolute terms or relative to the domestic market for that good, and under such conditions as to cause serious damage, or actual threat thereof, to a domestic industry producing a like or directly competitive good, the importing Party may, to the minimum extent necessary to remedy the damage or actual threat thereof:

• (a) suspend the further reduction of any rate of duty provided for under this Agreement on the good; or
• (b) increase the rate of duty on the good to a level not to exceed the lesser of
  • (i) the most-favored-nation (MFN) applied rate of duty in effect at the time the action is taken, and
  • (ii) the MFN applied rate of duty in effect on December 31, 1993.

2. In determining serious damage, or actual threat thereof, the Party:

• (a) shall examine the effect of increased imports on the particular industry, as reflected in changes in such relevant economic variables as output, productivity, utilization of capacity, inventories, market share, exports, wages, employment, domestic prices, profits and investment, none of which is necessarily decisive; and
• (b) shall not consider changes in technology or consumer preference as factors supporting a determination of serious damage or actual threat thereof.

3. A Party shall deliver without delay to any Party that may be affected by an emergency action taken under this Section written notice of its intent to take such action, and on request shall enter into consultations with that Party.

4. The following conditions and limitations apply to any emergency action taken under this Section:

• (a) no action may be maintained for a period exceeding three years or, except with the consent of the Party against whose good the action is taken, have effect beyond the expiration of the transition period;
• (b) no action may be taken by a Party against any particular good originating in the territory of another Party more than once during the transition period; and
• (c) on termination of the action, the rate of duty shall be the rate that, according to the Schedule for the staged elimination of the tariff, would have been in effect one year after the initiation of the action, and beginning January 1 of the year following the termination of the action, at the option of the Party that has taken the action
  • (i) the rate of duty shall conform to the applicable rate set out in that Party's Schedule to Annex 302.2, or
  • (ii) the tariff shall be eliminated in equal annual stages ending on the date set out in that Party's Schedule to Annex 302.2 for the elimination of the tariff.

5. The Party taking an action under this Section shall provide to the Party against whose good the action is taken mutually agreed trade liberalizing compensation in the form of concessions having substantially equivalent trade effects or equivalent to the value of the additional duties expected to result from the action. Such concessions shall be limited to the textile and apparel goods set out in Appendix 1.1, unless the Parties otherwise agree. If the Parties concerned are unable to agree on compensation, the exporting Party may take tariff action having trade effects substantially equivalent to the action taken under this Section against any goods imported from the Party that initiated the action under this Section. The Party taking the tariff action shall only apply the action for the minimum period necessary to achieve the substantially equivalent effects.

6. For purposes of this Section, a good originating in the territory of a Party shall be determined in accordance with Section 2.2.

7. Paragraphs 1 through 5 shall also apply to textile and apparel goods described in Appendix 2.4.

Section 5: Bilateral Emergency Actions (Quantitative Restrictions)

1. Subject to Appendix 5.1, a Party may take bilateral emergency action against non-originating textile or apparel goods of another Party in accordance with this Section and Appendix 3.1.

2. If a Party considers that a non-originating textile or apparel good, including a good entered under a tariff preference level set out in Appendix 6, is being imported into its territory from a Party in such increased quantities, in absolute terms or relative to the domestic market for that good, under such conditions as to cause serious damage, or actual threat thereof, to a domestic industry producing a like or directly competitive good in the importing Party, the importing Party may request consultations with the other Party with a view to eliminating the serious damage or actual threat thereof.

3. The Party requesting consultations shall include in its request for consultations the reasons that it considers demonstrate that such serious damage or actual threat thereof to its domestic industry is resulting from the imports of the other Party, including the latest data concerning such damage or threat.

4. In determining serious damage, or actual threat thereof, the Party shall apply Section 4(2).

5. The Parties concerned shall begin consultations within 60 days of the request for consultations and shall endeavor to agree on a mutually satisfactory level of restraint on exports of the particular good within 90 days of the request, unless the consulting Parties agree to extend this period. In reaching a mutually satisfactory level of export restraint, the consulting Parties shall:

• (a) consider the situation in the market in the importing Party;
• (b) consider the history of trade in textile and apparel goods between the consulting Parties, including previous levels of trade; and
• (c) seek to ensure that the textile and apparel goods imported from the territory of the exporting Party are accorded equitable treatment as compared with treatment accorded like textile and apparel goods from non-Party suppliers.

6. If the consulting Parties do not agree on a mutually satisfactory level of export restraint, the Party requesting consultations may impose annual quantitative restrictions on imports of the good from the territory of the other Party, subject to paragraphs 7 through 13.

7. Any quantitative restriction imposed under paragraph 6 shall be no less than the sum of:

• (a) the quantity of the good imported into the territory of the Party requesting consultations from the Party that would be affected by the restriction, as reported in general import statistics of the importing Party, during the first 12 of the most recent 14 months preceding the month in which the request for consultations was made; and
• (b) 20 percent of such quantity for cotton, man-made fiber and other non-cotton vegetable fiber good categories, and six percent for wool good categories.

8. The first period of any quantitative restriction imposed under paragraph 6 shall begin on the day after the date on which the request for consultations was made and terminate at the end of the calendar year in which the quantitative restriction is imposed. Any quantitative restriction that is imposed for a first period of less than 12 months shall be prorated to correspond to the time remaining in the calendar year in which the restriction is imposed, and the prorated amount may be adjusted in accordance with the flexibility provisions set out in paragraphs 8(b) and (c) of Appendix 3.1.

9. For each successive calendar year that the quantitative restriction imposed under paragraph 6 remains in effect, the Party imposing it shall:

• (a) increase it by six percent for cotton, man-made fiber and noncotton vegetable fiber textile and apparel goods, and by two percent for wool textile and apparel goods, and
• (b) accelerate the growth rate for quantitative restrictions on cotton, man-made fiber and non-cotton vegetable fiber textile and apparel goods if required by any successor agreement to the Multifiber Arrangement,

and the flexibility provisions set out in paragraphs 8(b) and (c) of Appendix 3.1 apply.

10. A quantitative restriction imposed under paragraph 6 before July 1 in any calendar year may remain in effect for the remainder of that year, plus two additional calendar years. Such a restriction imposed on or after July 1 in any calendar year may remain in effect for the remainder of that year, plus three additional calendar years. No such restriction may remain in effect beyond the transition period.

11. No Party may take an emergency action under this Section with respect to any particular textile or apparel non-originating good against which a quantitative restriction is in effect.

12. No Party may adopt or maintain a quantitative restriction under this Section on a particular textile or apparel good that otherwise would be permitted under this Annex, if that Party is required to eliminate such measure as a result of having integrated that good into the GATT as a result of commitments undertaken by that Party pursuant to any successor agreement to the Multifiber Arrangement.

13. No Party may take a bilateral emergency action after the expiration of the transition period with respect to cases of serious damage, or actual threat thereof, to domestic industry arising from the operation of this Agreement except with the consent of the Party against whose good the action would be taken.

Section 6: Special Provisions

Appendix 6 sets out special provisions applicable to certain textile and apparel goods.

Section 7: Review and Revision of Rules of Origin

1.

• (a) The Parties shall monitor the effects of the application of the rule of origin set out in Annex 401 applicable to goods of subheading 6212.10 of the Harmonized System (HS). No earlier than April 1, 1995, a Party may request consultations with the other Parties to seek a mutually satisfactory solution to any difficulties that it considers result from the application of that rule of origin.
• (b) If the consulting Parties fail to reach a mutually satisfactory solution within 90 days of a request for consultations, on request of any Party the rule of origin applicable to subheading 6212.10 shall change to the rule of origin set out in Annex 401 applicable to headings 62.06 through 62.11 with respect to trade between the requesting Party and the other Parties. Any such change shall be effective 180 days after the request. The Parties shall take measures to ease any resulting administrative burden on producers.
• (c) Unless the Parties agree otherwise, at any time after the completion of consultations held under subparagraph (a) and during the transition period only, a Party that has requested such consultations may make one additional request for consultations under subparagraph (a) and take action under subparagraph (b).

2.

• (a) On request of any Party, the Parties shall consult to consider whether particular goods should be subject to different rules of origin to address issues of availability of supply of fibers, yarns or fabrics in the free trade area.
• (b) In the consultations, each Party shall consider all data presented by a Party showing substantial production in its territory of the particular good. The consulting Parties shall consider that substantial production has been shown if that Party demonstrates that its domestic producers are capable of supplying commercial quantities of the good in a timely manner.
• (c) The Parties shall endeavor to conclude consultations within 60 days of the request. An agreement between two or more Parties resulting from the consultations shall supersede any prior rule of origin for such good when approved by each such Party in accordance with Article 2202(2) (Amendments). If no agreement is reached, a Party may have recourse to paragraph B.8 of Appendix 6.
• (d) Further to subparagraph (a), on request of any Party, the Parties shall consult to consider whether the rules of origin set out in Annex 401 applicable to the following provisions should be amended in view of increasing availability of supply of relevant yarns or fabrics within the free trade area:
  • (i) Canadian tariff item 5407.60.10, Mexican tariff item 5407.60.02 and U.S. tariff item 5407.60.22,
  • (ii) provisions (a) through (i) of the rule of origin for subheadings 6205.20 through 6205.30,
  • (iii) goods of subheadings 6107.21, 6108.21 and 6108.31, wholly of fabric of Canadian tariff item 6002.92.10, Mexican tariff item 6002.92.01, and U.S. tariff item 6002.92.10, and exclusive of collar, cuffs, waistband, elastic or lace;
  • (iv) note 2 to Chapter 62 of Annex 401, and
  • (v) Canadian tariff item 6303.92.10, Mexican tariff item 6303.92.01 and U.S. tariff item 6303.92.aa.

3. The Parties shall review the rules of origin applicable to textile and apparel goods within five years of the date of entry into force of this Agreement to take into account the effect of increasing global competition on textile and apparel goods and the implications of any integration into the GATT of textile and apparel goods pursuant to any successor agreement to the Multifiber Arrangement. The Parties shall give particular consideration to operative rules in other economic association or integration agreements and developments relating to textile and apparel production and trade.

Section 8: Labelling Requirements

The Subcommittee on Labelling of Textile and Apparel Goods established under Article 913(5) shall perform the functions set out in Annex 913.5.a4.

Section 9: Trade in Worn Clothing and Other Worn Articles

1. The Parties hereby establish a Committee on Trade in Worn Clothing, comprising representatives of each Party. The Committee shall:

• (a) include or consult with a broadly representative group drawn from the manufacturing and retailing sectors in each Party; and
• (b) act in a transparent manner and, if no member of the Committee formally objects, make recommendations to the Commission.

2. The Committee shall assess the potential benefits and risks that may result from the elimination of existing restrictions on trade between the Parties in worn clothing and other worn articles, as defined in heading 63.09 of the HS, including the effects on business and employment opportunities, and on the market for textile and apparel goods in each Party.

3. A Party may maintain restrictions in effect on the date of entry into force of this Agreement on the importation of worn clothing and other worn articles classified under heading 63.09 of the HS, unless the Parties agree otherwise on the basis of the recommendations presented to the Commission by the Committee on Trade in Worn Clothing.

Section 10: Definitions

For purposes of this Annex:

average yarn number, as applied to woven fabrics of cotton or man-made fibers, means the average yarn number of the yarns contained therein. In computing the average yarn number, the length of the yarn is considered to be equal to the distance covered by it in the fabric, with all clipped yarn being measured as if continuous and with the count being taken of the total single yarns in the fabric including the single yarns in any multiple (folded) or cabled yarns. The weight shall be taken after any excessive sizing is removed by boiling or other suitable process. Any one of the following formulas can be used to determine the average yarn number:

• N = BYT / 1,000
• N = 100T / Z'
• N = BT / Z
• N = ST / 10

when:

• N is the average yarn number,
• B is the breadth (width) of the fabric in centimeters,
• Y is the meters (linear) of the fabric per kilogram,
• T is the total single yarns per square centimeter,
• S is the square meters of fabric per kilogram,
• Z is the grams per linear meter of fabric, and
• Z' is the grams per square meter of fabric.
• Fractions in the resulting "average yarn number" shall be disregarded.

category means a grouping of textile or apparel goods, and as set out in Appendix 10.1 for the Parties specified in that Appendix;

consultation level means a level of exports for a particular textile or apparel good that may be adjusted in accordance with paragraph 7 of Appendix 3.1 and includes a designated consultation level, but does not include a specific limit;

exporting Party means the Party from whose territory a textile or apparel good is exported;

flexibility provisions means the provisions set out in paragraphs 8(b) and (c) of Appendix 3.1;

importing Party means the Party into whose territory a textile or apparel good is imported;

integrated into the GATT means subject to the obligations of the General Agreement on Tariffs and Trade , an agreement under the GATT or any successor agreements;

specific limit means a level of exports for a particular textile or apparel good that may be adjusted in accordance with paragraph 8 of Appendix 3.1;

square meters equivalent (SME) means that unit of measurement that results from the application of the conversion factors set out in Schedule 3.1.3 to a primary unit of measure such as unit, dozen or kilogram;

tariff preference level means a mechanism that provides for the application of a customs duty at a preferential rate to imports of a particular good up to a specified quantity, and at a different rate to imports of that good that exceed that quantity;

transition period means the 10year period beginning on January 1, 1994; and

wool apparel means:

• (a) apparel in chief weight of wool;
• (b) woven apparel in chief weight of man-made fibers containing 36 percent or more by weight of wool; and
• (c) knitted or crocheted apparel in chief weight of man-made fibers containing 23 percent or more by weight of wool.

Appendix 1.1: List of Goods Covered by Annex 300-B

Note: The descriptions listed in this Appendix are provided for ease of reference only. For legal purposes, coverage shall be determined according to the terms of the Harmonized System.

Appendix 2.1: Tariff Elimination

For purposes of this Appendix, each Party shall apply Section 2(2) to determine whether a textile or apparel good is an originating good of a particular Party.

A. Trade between Canada and the United States

As required by Article 302, Canada and the United States each shall progressively eliminate its respective customs duties on originating textile and apparel goods of the other Party in accordance with Annex 401.2, as amended, of the Canada United States Free Trade Agreement, as incorporated into Annex 302.2 and as set out in each Party's Schedule to that Annex.

B. Trade between Mexico and the United States

Except as provided in Schedule 2.1.B, and as required by Article 302, Mexico and the United States each shall progressively eliminate its respective customs duties on originating textile and apparel goods of the other Party, in accordance with its respective Schedule to Annex 302.2, as follows:

• (a) duties on textile and apparel goods provided for in the items in staging category A in a Party's Schedule shall be eliminated entirely and such goods shall be dutyfree, effective January 1, 1994;
• (b) duties on textile and apparel goods provided for in the items in staging category B6 in a Party's Schedule shall be reduced on January 1, 1994, by an amount equal, in percentage terms, to the base rates. Thereafter, duties shall be removed in five equal annual stages beginning on January 1, 1995, and such goods shall be dutyfree, effective January 1, 1999;
• (c) duties on textile and apparel goods provided for in the items in staging category C in a Party's Schedule shall be removed in 10 equal annual stages beginning on January 1, 1994, and such goods shall be dutyfree, effective January 1, 2003; and
• (d) if the application of a formula provided in subparagraph (b) or (c) for staging category B6 or C results in a duty that exceeds 20 percent ad valorem during any annual stage, the rate of duty during that stage shall be 20 percent ad valorem instead of the rate that otherwise would have applied.

C. Trade between Canada and Mexico

As required by Article 302, Canada and Mexico each shall progressively eliminate its respective customs duties on originating textile and apparel goods of the other Party, in accordance with its respective Schedule to Annex 302.2, as follows:

• (a) duties on textile and apparel goods provided for in the items in staging category A in a Party's Schedule shall be eliminated entirely and such goods shall be dutyfree, effective January 1, 1994;
• (b) duties on textile and apparel goods provided for in the items in staging category Bl in a Party's Schedule shall be removed in six equal annual stages beginning on January 1, 1994, and such goods shall be dutyfree, effective January 1, 1999;
• (c) duties on textile and apparel goods provided for in the items in staging category B+ in a Party's Schedule shall be reduced by the following percentages of the base rates, beginning on January 1, 1994, and such goods shall be dutyfree, effective January 1, 2001
  • (i) January 1, 1994, 20 percent
  • (ii) January 1, 1995, 0 percent
  • (iii) January 1, 1996, 10 percent
  • (iv) January 1, 1997, 10 percent
  • (v) January 1, 1998, 10 percent
  • (vi) January 1, 1999, 10 percent
  • (vii) January 1, 2000, 10 percent
  • (viii) January 1, 2001, 30 percent and
• (d) duties on textile and apparel goods provided for in the items in staging category C in a Party's Schedule shall be removed in 10 equal annual stages beginning on January 1, 1994, and such goods shall be dutyfree, effective January 1, 2003.

D. Trade between All Parties

Originating textile and apparel goods provided for in the items in staging category D in a Party's Schedule to Annex 302.2 shall continue to receive dutyfree treatment.

Schedule 2.1.B: Exceptions to Tariff Phaseout Formula Specified in Appendix 2.1

1. The United States shall apply the following rates of duty on tariff items 5111.11.70, 5111.19.60, 5112.11.20 and 5112.19.90 during the transition period:

• 1994: 25.0%
• 1995: 24.1%
• 1996: 18.0%
• 1997: 12.0%
• 1998: 6.0%
• 1999 and thereafter: 0.0%

2. Mexico shall apply the following rates of duty on tariff items 5111.11.01, 5111.19.99, 5112.11.01 and 5112.19.99, as modified to correspond to the U.S. tariff items identified in paragraph 1, during the transition period:

• 1994: 15.0%
• 1995: 14.5%
• 1996: 10.8%
• 1997: 7.2%
• 1998: 3.6%
• 1999 and thereafter: 0.0%

3. The United States shall apply the following rates of duty on tariff items 5111.20.90, 5111.30.90, 5112.20.30, 5112.30.30, 5407.91.05, 5407.92.05, 5407.93.05, 5407.94.05, 5408.31.05, 5408.32.05, 5408.33.05, 5408.34.05, 5515.13.05, 5515.22.05, 5515.92.05, 5516.31.05, 5516.32.05, 5516.33.05 and 5516.34.05 during the transition period:

• 1994: 25.0%
• 1995: 25.0%
• 1996: 20.0%
• 1997: 13.3%
• 1998: 6.7%
• 1999 and thereafter: 0.0%

4. Mexico shall apply the following rates of duty on tariff items 5111.20.99, 5111.30.99, 5112.20.01, 5112.30.01, 5407.91.99, 5407.92.99, 5407.93.99, 5407.94.99, 5408.31.99, 5408.32.99, 5408.33.99, 5408.34.99, 5515.13.01, 5515.22.01, 5515.92.01, 5516.31.01, 5516.32.01, 5516.33.01 and 5516.34.01, as modified to correspond to the U.S. tariff items identified in paragraph 3, during the transition period:

• 1994: 15.0%
• 1995: 15.0%
• 1996: 12.0%
• 1997: 8.0%
• 1998: 4.0%
• 1999 and thereafter: 0.0%

5. Mexico shall apply the following rates of duty on goods of subheadings 5703.20 and 5703.30 measuring not more than 5.25 square meters in area, other than nylon handhooked, during the transition period:

• 1994: 20.0%
• 1995: 20.0%
• 1996: 10.0%
• 1997: 6.6%
• 1998: 3.3%
• 1999 and thereafter: 0.0%

Appendix 2.4: Tariff Elimination on Certain Textile and Apparel Goods

On January 1, 1994, the United States shall eliminate customs duties on textile and apparel goods that are assembled in Mexico from fabrics wholly formed and cut in the United States and exported from and reimported into the United States under:

• (a) U.S. tariff item 9802.00.80.10; or
• (b) Chapter 61, 62 or 63 if, after such assembly, those goods that would have qualified for treatment under 9802.00.80.10 have been subject to bleaching, garment dyeing, stonewashing, acidwashing or permapressing.

Thereafter, the United States shall not adopt or maintain any customs duty on textile and apparel goods of Mexico that satisfy the requirements of subparagraph (a) or (b) or the requirements of any successor provision to U.S. tariff item 9802.00.80.10.

Appendix 3.1: Administration of Import and Export Prohibitions, Restrictions and Consultation Levels

A. Trade between Canada and Mexico and between Mexico and the United States

1. This Appendix applies to prohibitions, restrictions and consultation levels on nonoriginating textile and apparel goods.

2. An exporting Party whose textile or apparel good is subject to a prohibition, restriction or consultation level shall limit its annual exports to the specified limits or levels, and the importing Party may assist the exporting Party in implementing the prohibition, restriction or consultation level by controlling its imports.

3. Each Party shall count exports of textile and apparel goods subject to a restriction or consultation level against the limit or level:

• (a) applicable to the calendar year in which the good was exported; or
• (b) authorized for the following year if such exports exceed the authorized limit or level for the calendar year in which the good was exported, if allowed entry into the territory of the importing Party.

4. Each exporting Party whose goods are subject to a restriction or consultation level shall endeavor to space exports of such goods to the territory of the importing Party evenly throughout each calendar year, taking into consideration normal seasonal factors.

5. On written request of an exporting Party whose goods are subject to a prohibition, restriction or consultation level, that Party and the importing Party shall consult within 30 days of receipt of the request on any matter arising from the implementation of this Appendix.

6. On written request of an exporting Party that considers the application of a prohibition, restriction or consultation level under this Annex has placed it in an inequitable position in relation to another Party or a nonParty, the exporting Party and importing Party shall consult within 60 days of receipt of the request to seek a mutually beneficial solution.

7. An importing Party and an exporting Party, at any time by mutual agreement, may adjust annual Designated Consultation Levels (DCLs) as follows:

• (a) if the exporting Party whose goods are subject to a DCL wishes to export goods in any category in excess of the applicable DCL in any calendar year, that Party may present to the importing Party a formal written request for an increase in the DCL; and
• (b) the importing Party shall respond, in writing, within 30 days of the receipt of the request. If the response is negative, the Parties concerned shall consult no later than 15 days after the receipt of the response or as soon thereafter as mutually convenient, and shall endeavor to reach a mutually satisfactory solution. The Parties concerned shall confirm any agreement reached on a new DCL by an exchange of letters.

8. Adjustments to annual specific limits (SLs), including those set out in Schedule 3.1.2, may be made as follows:

• (a) an exporting Party wishing to adjust an SL shall deliver a notice to the importing Party of its intent to make an adjustment;
• (b) the exporting Party may increase the SL for a calendar year by no more than six percent ("swing"); and
• (c) in addition to any increase of its SL under subparagraph (b), the exporting Party may increase its unadjusted SL for that year by no more than 11 percent by allocating to such SL for that calendar year (the "receiving year") an unused portion ("shortfall") of the corresponding SL for the previous calendar year ("carryover") or a portion of the corresponding SL for the following calendar year ("carryforward"), as follows:
  • (i) subject to subparagraph (iii), the exporting Party may utilize carryover, as available, up to 11 percent of the unadjusted SL for the receiving year,
  • (ii) the exporting Party may utilize carryforward charged against the corresponding SL for the following calendar year, up to six percent of the unadjusted SL for the receiving year,
  • (iii) the combination of the exporting Party's carryover and carryforward shall not exceed 11 percent of the unadjusted SL in the receiving year, and
  • (iv) carryover may be utilized only following confirmation by the importing Party that sufficient shortfall exists. If the importing Party does not consider that sufficient shortfall exists, it shall promptly provide data to the exporting Party to support that view. Where substantial statistical differences exist between the import and export data on which the shortfall is computed, the Parties concerned shall seek to resolve these differences promptly.

B. Trade between Mexico and the United States

9. During the transition period, nonoriginating textile and apparel goods of Mexico exported to the United States shall be subject to the restrictions and consultation levels specified in Schedule 3.1.2, in accordance with this Appendix and its Schedules. Such restrictions and consultation levels shall be progressively eliminated as follows:

• (a) restrictions or consultation levels on items contained in the categories of textile and apparel goods in staging category 1 in Schedule 3.1.1 shall be eliminated on January 1, 1994;
• (b) restrictions or consultation levels on items contained in the categories of textile and apparel goods in staging category 2 in Schedule 3.1.1 shall be eliminated on January 1, 2001; and
• (c) restrictions or consultation levels on items contained in the categories of textile and apparel goods in staging category 3 in Schedule 3.1.1 shall be eliminated on January 1, 2004.

10. In addition, on January 1, 1994, the United States shall eliminate restrictions or consultation levels on textile and apparel goods that are assembled in Mexico from fabrics wholly formed and cut in the United States and exported from and reimported into the United States under:

• (a) U.S. tariff item 9802.00.80.10; or
• (b) Chapter 61, 62 or 63 if, after such assembly, those goods that would have qualified for treatment under 9802.00.80.10 have been subject to bleaching, garment dyeing, stonewashing, acidwashing or permapressing.

Thereafter, notwithstanding Section 5, the United States shall not adopt or maintain prohibitions, restrictions or consultation levels on textile and apparel goods of Mexico that satisfy the requirements of subparagraph (a) or (b) or the requirements of any successor provision to U.S. tariff item 9802.00.80.10.

11. Mexico and the United States may identify at any time particular textile and apparel goods that they mutually agree fall within:

• (a) handloomed fabrics of a cottage industry;
• (b) handmade cottage industry goods made of such handloomed fabrics; or
• (c) traditional folklore handicraft goods.

The importing Party shall exempt from restrictions and consultation levels goods so identified, if certified by the competent authority of the exporting Party.

12. The Bilateral Textile Agreement Between the United States of America and the United Mexican States, signed at Mazatlán, February 13, 1988, as amended and extended (the Bilateral Agreement), shall terminate on the date of entry into force of this Agreement.

13. On request of either Party, the Parties shall consult to consider accelerating the elimination of restrictions or consultation levels set out in Schedule 3.1.2 on specific textile and apparel goods. An agreement between the Parties to accelerate the elimination of a restriction or consultation level shall supersede Schedule 3.1.1 when approved by each such Party in accordance with Article 2202(2) (Amendments).

14. During 1994, Mexico may carry over any unused portion of the 1993 limit specified in the Bilateral Agreement, or apply against the 1994 limit specified in this Appendix any exports made during 1993 in excess of the applicable limit under the Bilateral Agreement, in accordance with the flexibility provisions set forth in paragraph 8.

15. All exports of textile and apparel goods from the territory of Mexico to the territory of the United States covered by restrictions or consultation levels under this Appendix shall be accompanied by an export visa issued by the competent authority of Mexico, pursuant to any bilateral visa arrangement in effect between the Parties.

16. On written request of either Party, both Parties shall consult within 30 days of receipt of the request on any matter arising from the implementation of this Appendix. In addition, on written request of either Party, both Parties shall conduct a review of this Appendix by January 1, 1999.

17. For purposes of applying prohibitions, restrictions or consultation levels, each Party shall consider a good as being of:

• (a) man-made fibers if the good is in chief weight of man-made fibers, unless
  • (i) the good is knitted or crocheted apparel in which wool equals or exceeds 23 percent by weight of all fibers, in which case it shall be of wool,
  • (ii) the good is apparel, not knitted or crocheted, in which wool equals or exceeds 36 percent by weight of all fibers, in which case it shall be of wool, or
  • (iii) the good is a woven fabric in which wool equals or exceeds 36 percent by weight of all fibers, in which case it shall be of wool;
• (b) cotton, if not covered by subparagraph (a) and if the good is in chief weight of cotton, unless the good is a woven fabric in which wool equals or exceeds 36 percent by weight of all fibers, in which case it shall be of wool;
• (c) wool, if not covered by subparagraph (a) or (b), and the good is in chief weight of wool; and
• (d) non-cotton vegetable fiber, if not covered by subparagraph (a), (b) or (c), and the good is in chief weight of non-cotton vegetable fiber, unless
  • (i) cotton with wool and/or man-made fibers in the aggregate equal or exceed 50 percent by weight of the component fibers thereof and the cotton component equals or exceeds the weight of each of the total wool and/or man-made fiber components, in which case it shall be of cotton,
  • (ii) if not covered by subparagraph (i) and wool exceeds 17 percent by weight of all component fibers, in which case it shall be of wool, or
  • (iii) if not covered by subparagraph (i) or (ii) and man-made fibers in combination with cotton and/or wool in the aggregate equal or exceed 50 percent by weight of the component fibers thereof and the man-made fiber component exceeds the weight of the total wool and/or total cotton component, in which case it shall be of man-made fibers.

For purposes of this paragraph, only the textile fibers in the component of the good that determines the tariff classification of the good are to be considered.

C. Schedules

To determine which HS provisions are contained in a U.S. category listed in the Schedules to this Appendix, the Parties shall refer to the Correlation: Textile and Apparel Categories with the Harmonized Tariff Schedule of the United States, 1992 (or successor document), U.S. Department of Commerce, International Trade Administration, Office of Textiles and Apparel, Trade and Data Division, Washington, D.C. The descriptions listed in these Schedules are provided for ease of reference only. For legal purposes, coverage of a category shall be determined according to the Correlation.

Schedule 3.1.1: Schedule for the Elimination of Restrictions and Consultation Levels on Exports from Mexico to the United States

A. Special Regime (SR) Goods

B. Non-originating Goods

Schedule 3.1.2: Restrictions and Consultation Levels on Exports from Mexico to the United States

Schedule 3.1.3: Conversion Factors

1. This Schedule applies to restrictions and consultation levels applied pursuant to Section 5 and paragraph 9 of Appendix 3.1, and to tariff preference levels applied pursuant to Section 6 and Appendix 6.

2. Unless otherwise provided in this Annex, or as may be mutually agreed between any two Parties with respect to trade between them, the rates of conversion into SME set out in paragraphs 3 through 6 shall apply.

3. The following conversion factors shall apply to the goods covered by the following U.S. categories:

4. The following conversion factors shall apply to the following goods not covered by a U.S. category:

5.

• (a) The primary unit of measure for the following tariff items in U.S. category 666 shall be NO and shall be converted into SME by a factor of 5.5:
  • 6301.10.0000: Electric blankets
  • 6301.40.0010: Blankets (not electric) & travel rugs of synthetic fiber, woven
  • 6301.40.0020: Blankets (not electric) & travel rugs of synthetic fiber, nes
  • 6301.90.0010: Blankets and traveling rugs of artificial fiber
  • 6302.10.0020: Bed linen, knitted or crocheted fabric, excluding cotton
  • 6302.22.1030: Sheets with trim, napped, printed, man-made fiber
  • 6302.22.1040: Sheets with trim, not napped, printed, man-made fiber
  • 6302.22.1050: Bolster cases with trim, printed, man-made fiber
  • 6302.22.1060: Bed linen with trim, printed, man-made fiber, nes
  • 6302.22.2020: Sheets, not trimmed, printed, man-made fiber
  • 6302.22.2030: Bed linen, not trimmed, printed, man-made fiber, nes
  • 6302.32.1030: Sheets with trim, napped, man-made fiber
  • 6302.32.1040: Sheets with trim, not napped, man-made fiber
  • 6302.32.1050: Bolster cases with trim, man-made fiber
  • 6302.32.1060: Bed linen with trim, man-made fiber, nes
  • 6302.32.2030: Sheets, not trimmed, napped, man-made fiber
  • 6302.32.2040: Sheets not trimmed, not napped, man-made fiber
  • 6302.32.2050: Bolster cases, not trimmed, man-made fiber
  • 6302.32.2060: Bed linen nes, man-made fiber
  • 6304.11.2000: Bedspreads, knit/crocheted, man-made fiber
  • 6304.19.1500: Bedspreads with trim, man-made fiber, nes
  • 6304.19.2000: Bedspreads, man-made fiber, nes
• (b) The primary unit of measure for the following tariff items in u.s. category 666 shall be no and shall be converted into sme by a factor of 0.9:
  • 6302.22.1010: Pillowcases with trim, printed, napped, man-made fiber
  • 6302.22.1020: Fundas para almohadas de fibras sintéticas y artificiales, con adornos, estampadas, no afelpadas
  • 6302.22.1020: Pillowcases with trim, printed, not napped, man-made fiber
  • 6302.22.2010: Pillowcases, not trimmed, printed, man-made fiber
  • 6302.32.1010: Pillowcases with trim, napped, man-made fiber
  • 6302.32.1020: Pillowcases with trim, not napped, man-made fiber
  • 6302.32.2010: Pillowcases, not trimmed, napped, man-made fiber
  • 6302.32.2020: Pillowcases not trimmed, not napped, man-made fiber

6. The primary unit of measure for garment parts of subheadings 6117.90 and 6217.90 shall be KG and shall be converted into SME by applying the following factors:

• Cotton apparel: 8.50
• Wool apparel: 3.70
• Man-made fiber apparel: 14.40
• Other noncotton vegetable fiber apparel: 12.50

7. For the purposes of this Schedule:

• DPR means dozen pair;
• DZ means dozen;
• KG means kilogram;
• NO means number; and
• SM means square meter.

Appendix 5.1

Bilateral Emergency Actions
(Quantitative Restrictions)

As between Canada and the United States, actions otherwise permitted under Section 5 shall be governed by Article 407 of the Canada United States Free Trade Agreement, which is hereby incorporated into and made a part of this Agreement solely for that purpose.

Appendix 6: Special Provisions

A. Rules Applicable to Certain Carpets and Sweaters

For purposes of trade between Mexico and the United States, a good of either Party of HS Chapter 57, subheading 6110.30, 6103.23 or 6104.23 shall be treated as if it were an originating good only if any of the following changes in tariff classification is satisfied within the territory of one or more of the Parties:

• (a) a change to subheading 5703.20 or 5703.30 or heading 57.04 from any heading outside Chapter 57 other than headings 51.06 through 51.13, 52.04 through 52.12, 53.08, 53.11 or any headings of Chapter 54 or 55; or a change to any other heading or subheading of Chapter 57 from any heading outside that chapter other than headings 51.06 through 51.13, 52.04 through 52.12, 53.08, 53.11, any heading of Chapter 54 or 55.08 through 55.16; and
• (b) a change to U.S. tariff item 6110.30.10.10, 6110.30.10.20, 6110.30.15.10, 6110.30.15.20, 6110.30.20.10, 6110.30.20.20, 6110.30.30.10, 6110.30.30.15, 6110.30.30.20, or 6110.30.30.25 or Mexican tariff item 6110.30.01, or a good of those tariff items that is classified as part of an ensemble in subheading 6103.23 or 6104.23, from any heading outside Chapter 61 other than headings 51.06 through 51.13, 52.04 through 52.12, 53.07 through 53.08, 53.10 through 53.11, any heading of Chapter 54 or 55, 60.01 or 60.06, provided that the good is both cut (or knit to shape) and sewn or otherwise assembled in the territory of one or more of the Parties; or a change to any other tariff item of subheading 6110.30 from any heading outside Chapter 61 other than headings 51.06 through 51.13, 52.04 through 52.12, 53.07 through 53.08, 53.10 through 53.11, any heading of Chapter 54, 55.08 through 55.16, 60.01 or 60.06, provided, that the good is both cut (or knit to shape) and sewn or otherwise assembled in the territory of one or more of the Parties.

B. Preferential Tariff Treatment for Non-Originating Goods of Another Party

Apparel and Made-Up Goods

1.

• (a) Each Party shall apply the rate of duty applicable to originating goods set out in its Schedule to Annex 302.2, and in accordance with Appendix 2.1, up to the annual quantities specified in Schedule 6.B.1, in SME, to apparel goods provided for in Chapters 61 and 62 that are both cut (or knit to shape) and sewn or otherwise assembled in the territory of a Party from fabric or yarn produced or obtained outside the free trade area, and that meet other applicable conditions for preferred tariff treatment under this Agreement. The SME shall be determined in accordance with the conversion factors set out in Schedule 3.1.3.
• (b) The annual tariff preference levels (TPLs) of imports from Canada into the United States shall be adjusted annually for five consecutive years commencing on January 1, 1995, by the following growth factors:
  • (i) for cotton or man-made fiber apparel, 2 percent,
  • (ii) for cotton or man-made fiber apparel made from fabrics woven or knit in a non-Party, 1 percent, and
  • (iii) for wool apparel, 1 percent.

2. The United States shall apply the rate of duty applicable to originating goods set out in its Schedule to Annex 302.2, and in accordance with Appendix 2.1, up to the annual quantity specified in Schedule 6.B.1, to textile or apparel goods provided for in Chapters 61, 62 and 63 that are sewn or otherwise assembled in Mexico as provided for in U.S. tariff item 9802.00.80.60 from fabric which is knit or woven outside the territory of the United States or Mexico, when exported to the United States. This paragraph shall not apply after quantitative restrictions established pursuant to the Multifiber Arrangement or any successor agreement are terminated.

Exceptions

3. As between Mexico and the United States:

• (a) apparel goods provided for in Chapters 61 and 62 of the HS, in which the fabric that determines the tariff classification of the good is classified in one of the following tariff provisions, are ineligible for preferential tariff treatment provided for under the levels established in Schedule 6.B.1
  • (i) blue denim: subheadings 5209.42 and 5211.42, U.S. tariff items 5212.24.60.20, and 5514.32.00.10 or Mexican tariff items 5212.24.xx and 5514.32.xx; and
  • (ii) fabric woven as plain weave where two or more warp ends are woven as one (oxford cloth) of average yarn number less than 135 metric number: 5208.19, 5208.29, 5208.39, 5208.49, 5208.59, 5210.19, 5210.29, 5210.39, 5210.49, 5210.59, 5512.11, 5512.19, 5513.13, 5513.23, 5513.33, and 5513.43;
• (b) apparel goods provided for in U.S. tariff items 6107.11.00, 6107.12.00, 6109.10.00 and 6109.90.00 or Mexican tariff items 6107.11.01, 6107.12.01, 6109.10.01 and 6109.90.01 are ineligible for preferential tariff treatment provided for under the levels established in Schedule 6.B.1 if they are composed chiefly of circular knit fabric of yarn number equal to or less than 100 metric number. Apparel goods provided for in subheadings 6108.21 and 6108.22 are ineligible for preferential tariff treatment provided for under the levels established in parts 2(a), 2(b), 3(a) and 3(b) in Schedule 6.B.1 if they are composed chiefly of circular knit fabric of yarn number equal to or less than 100 metric number; and
• (c) apparel goods provided for in U.S. tariff items 6110.30.10.10, 6110.30.10.20, 6110.30.15.10, 6110.30.15.20, 6110.30.20.10, 6110.30.20.20, 6110.30.30.10, 6110.30.30.15, 6110.30.30.20, 6110.30.30.25 and items of those tariff items that are classified as parts of ensembles in U.S. tariff items 6103.23.00.30, 6103.23.00.70, 6104.23.00.22 and 6104.23.00.40 or Mexican tariff item 6110.30.01or goods of that tariff item that are classified as parts of ensembles in subheading 6103.23 or 6104.23 are ineligible for preferential tariff treatment provided for under the levels established in Schedule 6.B.1.

Fabric and Made-Up Goods

4.

• (a) Each Party shall apply the rate of duty applicable to originating goods set out in its Schedule to Annex 302.2, and in accordance with Appendix 2.1, up to the annual quantities specified in Schedule 6.B.2, in SME, to cotton or man-made fiber fabric and cotton or man-made fiber made-up textile goods provided for in Chapters 52 through 55, 58, 60, and 63 that are woven or knit in a Party from yarn produced or obtained outside the free trade area, or knit in a Party from yarn spun in a Party from fiber produced or obtained outside the free trade area, and to goods of subheading 9404.90 that are finished and cut and sewn or otherwise assembled from fabrics of subheadings 5208.11 through 5208.29, 5209.11 through 5209.29, 5210.11 through 5210.29, 5211.11 through 5211.20, 5212.11, 5212.12, 5212.21, 5212.22, 5407.41, 5407.51, 5407.71, 5407.81, 5407.91, 5408.21, 5408.31, 5512.11, 5512.21, 5512.91, 5513.11 through 5513.19, 5514.11 through 5514.19, 5516.11, 5516.21, 5516.31, 5516.41, 5516.91 produced or obtained outside the free trade area, and that meet other applicable conditions for preferred tariff treatment under this Agreement. The SME shall be determined in accordance with the conversion factors set out in Schedule 3.1.3.
• (b) The annual TPL and sublevels on imports from Canada into the United States shall be adjusted by an annual growth factor of two percent for five consecutive years commencing on January 1, 1995.

5. For purposes of paragraph 4, the number of SME that will be counted against the TPLs applied as between Canada and the United States shall be:

• (a) for textile goods that are not originating because certain non-originating textile materials do not undergo the applicable change in tariff classification set out in Annex 401 for that good, but where such materials are 50 percent or less by weight of the materials of that good, only 50 percent of the SME for that good, determined in accordance with the conversion factors set out in Schedule 3.1.3; and
• (b) for textile goods that are not originating because certain non-originating textile materials do not undergo the applicable change in tariff classification set out in Annex 401 for that good, but where such materials are more than 50 percent by weight of the materials of that good, 100 percent of the SME for that good, determined in accordance with the conversion factors set out in Schedule 3.1.3.

Rules Applicable to Fabrics Woven From Yarns of Combed Camel Hair or Cashmere

For purposes of trade between Canada and the United States, a good of either Party of subheading 5112.11 or 5112.19 shall be treated as if it were an originating good only if any of the following changes in tariff classification is satisfied within the territory of one or both of the Parties:

• (a) a change to woven fabrics, other than tapestry fabrics or upholstery fabrics of a weight not exceeding 140 grams per square meter, of combed fine animal hair of subheading 5112.11 from yarn of combed camel hair or combed cashmere of subheading 5108.20 or any other heading, except from heading 51.06 through 51.07, any other good of heading 51.08 or heading 51.09 through 51.11, 51.13, 52.05 through 52.06, 54.01 through 54.04 or 55.09 through 55.10; and
• (b) a change to woven fabrics, other than tapestry fabrics or upholstery fabrics, of combed fine animal hair of subheading 5112.19 from yarn of combed camel hair or combed cashmere of subheading 5108.20 or any other heading, except from heading 51.06 through 51.07, any other good of heading 51.08 or heading 51.09 through 51.11, 51.13, 52.05 through 52.06, 54.01 through 54.04 or 55.09 through 55.10.

Rule Applicable to Pile Fabric Containing Dry Spun Acrylic Fiber

For purposes of trade between Canada and the United States, a good of either Party of subheading 5801.35 shall be treated as if it were an originating good only if any of the following changes in tariff classification is satisfied within the territory of one or both of the Parties:

• a change to woven-warp pile fabric, cut, of subheading 5801.35, with pile of dry-spun acrylic staple fibers of subheading 5503.30, which fabric has been dyed in the piece to a single uniform color, from any other chapter, except from heading 51.06 through 51.13, 52.04 through 52.12, 53.07 through 53.08 or 53.10 through 53.11, Chapter 54, heading 55.01 through 55.02, subheading 5503.11 through 5503.20 or 5503.40 through 5503.90 or heading 55.04 through 55.16.

Rule Applicable to Chenille Fabric Containing Acrylic Staple Fibres

For purposes of trade between Canada and the United States, a good of either Party of subheading 5801.36 shall be treated as if it were an originating good only if any of the following changes in tariff classification is satisfied within the territory of one or both of the Parties:

• a change to subheading 5801.36 from any other chapter, except from heading 51.06 through 51.13, 52.04 through 52.12, 53.07 through 53.08 or 53.10 through 53.11, Chapter 54, heading 55.01 through 55.02, subheading 5503.10 through 5503.20 or 5503.40 through 5503.90 or heading 55.04 through 55.16.

Spun Yarn

6.

• (a) Each Party shall apply the rate of duty applicable to originating goods set out in its Schedule to Annex 302.2, and in accordance with Appendix 2.1, up to the annual quantities specified in Schedule 6.B.3, in kilograms (kg), to cotton or man-made fiber yarns provided for in headings 52.05 through 52.07 or 55.09 through 55.11 that are spun in a Party from fiber of headings 52.01 through 52.03 or 55.01 through 55.07, produced or obtained outside the free trade area and that meet other applicable conditions for preferred tariff treatment under this Agreement.
• (b) The annual TPL on imports from Canada into the United States shall be adjusted by an annual growth factor of two percent for five consecutive years commencing on January 1, 1995.

7. Textile or apparel goods that enter the territory of a Party under paragraph 1, 2, 4 or 6 shall not be considered to be originating goods.

Rule Applicable to Chenille Fabric Containing Acrylic Staple Fibres

For purposes of trade between Canada and the United States, a good of either Party of subheading 5509.31 shall be treated as if it were an originating good only if any of the following changes in tariff classification is satisfied within the territory of one or both of the Parties:

• a change to subheading 5509.31 from acid-dyeable acrylic tow of subheading 5501.30 or any other chapter, except from heading 52.01 through 52.03 or 54.01 through 54.05.

Review and Consultations

8.

• (a) Trade in the goods referred to in paragraphs 1, 2, 4 and 6 shall be monitored by the Parties. On request of any Party wishing to adjust any annual TPL for imports into Canada from Mexico or the United States, imports into Mexico from Canada or the United States, or imports into the United States from Mexico, based on the ability to obtain supplies of particular fibers, yarns and fabrics, as appropriate, that can be used to produce originating goods, the Parties shall consult with a view to adjusting such level. Any adjustment in the TPL requires the mutual consent of the Parties concerned.
• (b) Canada and the United States shall decide, in the review referred to in Section 7(3), whether to continue to apply annual growth factors to the specified TPLs after the five consecutive years. If a growth factor for a TPL is not continued as a result of the review, subparagraph (a) shall also apply to imports from Canada into the United States of goods covered by the TPL.

Schedule 6.B.1: Preferential Tariff Treatment for Non-Originating Apparel and Made-Up Goods

1. Imports into Canada

(a) Cotton or Man-made fiber apparel:
from Mexico: 6,000,000 SME
from United States: 9,000,000 SME

(b) Wool apparel:
from Mexico: 250,000 SME
from United States: 919,740 SME

2. Imports into Mexico

(a) Cotton or Man-made fiber apparel:
from Canada: 6,000,000 SME
from United States: 12,000,000 SME

(b) Wool apparel:
from Canada: 250,000 SME
from United States: 1,000,000 SME

3. Imports into United States

(a) Cotton or Man-made fiber apparel:
from Canada: 80,000,000 SME^{Footnote 1}
from Mexico: 45,000,000 SME

(b) Wool apparel:
from Canada: 5,066,948 SME^{Footnote 2}
from Mexico: 1,500,000 SME

(c) Goods imported under U.S. tariff item 9802.00.80.60:
from Canada: n/a
from Mexico: 25,000,000 SME

Schedule 6.B.2: Preferential Tariff Treatment for Non-Originating Cotton or Man-made Fiber Fabrics and Made-Up Goods

1. Imports into Canada:
from Mexico: 7,000,000 SME
from United States: 2,000,000 SME^{Footnote 1}

2. Imports into Mexico:
from Canada: 7,000,000 SME
from United States: 2,000,000 SME

3. Imports into United States:
from Canada: 65,000,000 SME^{Footnote 2}
from Mexico: 24,000,000 SME^{Footnote 3}.

Schedule 6.B.3: Preferential Tariff Treatment for Non-Originating Cotton or Man-made Fiber Spun Yarn

1. Imports into Canada :
from Mexico: 1,000,000 kg
from United States: 1,000,000 kg

2. Imports into Mexico:
from Canada: 1,000,000 kg
from United States: 1,000,000 kg

3. Imports into United States:
from Canada: 10,700,000 kg
from Mexico: 1,000,000 kg

Appendix 10.1: Country-Specific Definitions

Definitions Specific to Canada

general import statistics means statistics issued by Statistics Canada or, where available, import permit data provided by the Export and Import Permits Bureau of the Department of External Affairs and International Trade, or their successors.

Definitions Specific to Mexico

general import statistics means the statistics of the "Sistema de Informacion Comercial" (Trade Information System) or its successor.

Definitions Specific to the United States

category means a grouping of textile or apparel goods defined in the Correlation: Textile and Apparel Categories with the Harmonized Tariff Schedule of the United States, 1992 (or successor publication), published by the United States Department of Commerce, International Trade Administration, Office of Textiles and Apparel, Trade and Data Division, Washington, D.C.; and general import statistics means statistics of the U.S. Bureau of the Census or its successor.